To prevent a default at the eleventh hour Obama may have relinquished the last arrow in his political quiver by agreeing to deep cuts in government spending which some economists believe might jeopardise this fragile recovery.

The American national debt is extravagant, so vast as to be almost unimaginable. Everyone agrees that something must give and at this point, Republicans and Democrats face two options: raising taxes or cutting public programs.

The world - especially the financial community no longer believes the U.S. Government functions properly and may not be able to be trusted to act like responsible adults in charge of the world's most important economy.